"It’s The Market That Got Us Here In The First Place"
The editors of the Washington Times are arguing that in considering health care reform, President-elect Barack Obama should allow the marketplace to lower health care costs and improve access to care:
The overwhelming majority of Americans are covered, and for them the number one issue is affordability, with accessibility a close second. Let the marketplace answer both calls…The government cannot possibly do for Americans what the marketplace can.
But the marketplace is part of the problem; it has failed to keep costs down and increase access to care.
Rather than competing on the value of care, insurance markets have “become dominated by a small number of large insurers” that don’t use their market power to drive bargains with providers. Competing in the insurance market is “about getting the lowest risk enrollees as opposed to competing on price and the efficient delivery of care.”
In 2003, for instance, “in all but 14 states, three or fewer insurers accounted for 65 percent of the commercial market.” And “while medical care costs grew considerably faster than inflation,” “private insurer revenue increased even faster, suggesting that the market power of insurers means that they are “not only able to pass on health care costs to purchasers but to increase profitability at the same time.”
The marketplace has contributed to skyrocketing premiums, huge cost-shifts to families through higher deductibles and copayments, and has largely excluded individuals with pre-exisiting conditions from coverage. Despite the editors’ claims, the marketplace hasn’t answered “both calls” (of affordability and accessibility). It has hung up the phone and left the American people with a broken health care system.